PLDT sees light at end of tunnel

Miguel R. Camus

2 weeks ago

Philippine Long Distance Telephone Co. (PLDT). AFP FILE PHOTO

Telco giant PLDT Inc. sounded off hope that its business struggles were coming to a close this 2018.

The company announced that it beat expectations on at least one of three earnings measures it started to track in 2017. Moreover, consolidated service revenues, which dropped 3 percent to P143.5 billion last year, is forecast to rise 4 percent in 2018, PLDT chair and CEO Manuel V. Pangilinan said on Thursday.

“Things are beginning to look up for the group. I’m not saying we are completely out of the woods, but it seems we are getting there,” Pangilinan said in a press briefing.

PLDT announced Thursday that recurring core income, a relatively new earnings measure, rose 11 percent to P22.3 billion in 2017— beating the initial target by around P300 million. For 2018, this could rise to as much as P24 billion, an improvement of 7.6 percent.

This is distinct from core income, which includes nonrecurring items like the sale of its stake in Manila Electric Co. PLDT’s 2017 core income dipped lower by 1 percent to P27.7 billion.

The last measure is its reported net income, which fell 33 percent to P13.4 billion last year due to the swap of parts of its network and accelerated depreciation. These were part of PLDT’s network upgrade program as it seeks to address complaints over the quality of its network.

PLDT’s revenues last year were dragged lower by its wireless business, which sank 11 percent. PLDT chief revenue officer Ernesto Alberto noted there was reason to be optimistic as the decline “stabilized” through 2017.

The company is expecting wireless revenues to remain at least flat through 2018, Pangilinan said.

Similar to the previous year, it underscored its focus on the fixed-line business. Its home and enterprise units both saw double-digit gains in 2017, bringing overall contribution to 47 percent of total service revenues. This trend is seen to continue in 2018.

Revenues for home grew 13 percent to P33 billion while enterprise was up 11 percent to P34.1 billion. The focus on fixed-line is reflected in its capital spending plans, which is estimated at P58 billion for 2018, up from P40 billion last year. PLDT said 53 percent would be allocated for fixed line with the remainder going to wireless.

Pangilinan said PLDT was open to selling its roughly 6-percent stake in Germany’s Rocket Internet to finance its capital spending plans.